*Subject to confirmation
26 April 2015 17:30 Pre-Registration 18:00 Welcome Reception at Florentine
Gardens of Hilton Lake Las Vegas, hosted by 27 April 2015 08:00 Registration 09:00 Welcome Address by LVCVA
Board Chairman and Clark County Commissioner Lawrence Weekly 09:15 Keynote Address by Congresswoman Dina Titus,
Nevada's First District 09:25 The changing shape of world aviation 09:35 Alliances, partnerships and Old World markets Panellists: 10:15 Understanding the Asia Pacific growth opportunities:
from the horse’s mouth. Tony Fernandes explains the market 11:00 COFFEE 11:30 Introduction to AIRLINK 11:45 Seizing the Asia Pacific growth opportunities: and
getting from here to there Moderator: CAPA, Executive Chairman, Peter
Harbison Panellists: 13:00 LUNCH After lunch, the Summit splits into 2 streams Stream A: USA 14:00 ‘Short-termism’: Are analysts stifling productive innovation
in the airline industry in favour of short-term investor profits? Panellists: 14:45 Can Ultra-LCCS and “Hybrids” establish a foothold in
the US airline market over the long-term?
Moderator: Cowen and Company,
Managing Director & Senior Airline Analyst, Helane Becker 16:00 COFFEE 16:30 Airline deregulation? Airport and airways
infrastructure need privatisation; regulation needs rationalisation Moderator: ICF International,
Vice President, Samuel Engel Stream B: Canada, Mexico & Latin America 14:00 What’s wrong with Canada’s aviation policy settings? Moderator: Consultant,
John Byerly Panellists: 16:00 COFFEE 16:30 The outlook for aviation in Latin America Moderator: HEICO, BDO/Advisor to the
Executive Board of ALTA, Alex de Gunten 17:30 End of Day 1 18:00 Happy Hour in the Travelport Lounge
18:45 Buses depart to Networking Reception at Hyde
Bellagio 22:00 Reception ends and buses return to Hilton Lake from
Hyde Bellagio. Last bus departs at 23:00. 28 April 2015 07:45 Special Industry Breakfast Briefing: The strategy
behind Airline network planning In this special session, leading airline network
planning heads will provide insights into their near and longer-term route
plans. Their presentations will be followed by a round-table discussion of
the art and science (and guesswork) of effective network planning. Moderator: Airline Strategist and author, Nawal Taneja 09:00 The Gulf carriers: Good for the US airline industry
as well as for consumers? Or a threat to sustainability? Moderator: Pillsbury Law,
Partner, Kenneth Quinn Panellists: 11:00 COFFEE 11:30 Leadership panel: Why don’t women run airlines? Moderator: Korn Ferry,
Senior Client Partner, Frank Morogiello 12:20 Achieving the customer-centric airlines of the future
In an innovative and challenging feature, a
panel of leading airline and industry executives will debate retailing,
merchandising and loyalty strategies designed to personalise the customer
experience and drive airline revenue growth. Moderator: L.E.K. Consulting,
Managing Director and Partner, John Thomas 13:10 LUNCH 14:10 How can corporate travellers get what they really
want? Changing airline profiles, the distribution
debate and a persistent corporate attack on travel costs has forced
intermediaries to adapt and re-establish their roles in the market. Moderator: Association of Corporate Travel
Executives (ACTE), Executive Director, Greeley Koch 15:00 Pilot unions and their future role in the airline
industry The airline industry, containing as it does so
many varied activities, has a proliferation of unions. But pilots tend to be
the most powerful – and nowhere are pilots more powerful as a voice than in
the US. Their influence on airline management has been enhanced by
consolidation and the quest for higher returns . Moderator: Cranky Filer,
President, Brett Snyder
Panellists: 15:50 Conference close
CAPA, Executive Chairman, Peter Harbison
The Atlantic market between North America and Europe has long been among the
richest – but not always most profitable – in the world. It has been a
melting pot for regulatory initiatives, from the unregulated “charters” of
the 1970s and 80s to today’s open skies and metal neutral JVs, protected by
antitrust immunity. Often plagued by overcapacity, North Atlantic markets in
particular are distinguished by their high level of premium travel. Today,
the three select sub-groups of global alliance partners account for almost
three quarters of all US-Europe seats and are able to manage capacity much
more carefully. Other airlines are inevitably at a disadvantage in
competitive terms, where they are unable to collaborate on capacity, pricing
and route planning, but arguably all benefit from the new capacity
“discipline”. The panel explores the role of this relatively new form of JV
and their impact on the market – and the airlines which are on the outside.
Moderator: Consultant, John Byerly
AirAsia, Group CEO, Tony Fernandes
No-one doubts that Asia will become the dominant world aviation market over
coming decades. North America and its airlines will necessarily be major
beneficiaries of that expansion. For the time being however, the US-China
market is only one third the size of US-UK’s and much lower yielding; Asia’s
two biggest markets, China and Japan combined are still smaller than the UK
market. But China-US capacity will double in the two years to Jul-2017, a trajectory
that is likely to continue.
Meanwhile the nature of the Asian aviation markets has evolved greatly over
the period of a decade. In Southeast Asia, nearly two thirds of all airline
seats are on low-cost airlines, none of which existed a decade ago, implying
a highly price sensitive underlying market.
In North Asia, this low-cost, price sensitive phenomenon is starting to take
hold as well, albeit from a much lower market share. But it is growing fast,
with many new entrants.
To understand fully how these forces will influence Asian consumer demand, we
hear from Malaysia based Tony Fernandes, the man who sparked the LCC
revolution in Asia and whose airline, AirAsia, has now carried 50 million
passengers. In doing so, he has effectively deregulated international
aviation across much of Asia.
The remarkable airline, with 9 operating entities, including cross border
joint ventures in various countries, also includes three long-haul low-cost
operators.
We hear from Mr Fernandes and then get to some vital insights in a lively
Q&A session.
AIRLINK, Member of Board Trustee, Tetsuya Nozaki
No-one doubts that Asia will become the dominant world aviation market over
coming decades. North America and its airlines will necessarily be major
beneficiaries of that expansion. For the time being however, the US-China
market is only one third the size of US-UK’s and much lower yielding; Asia’s
two biggest markets, China and Japan combined are still smaller than the UK
market. But China-US capacity will double in the two years to Jul-2015, a
trajectory that is likely to continue.
The greater proximity of the West Coast of North America means that air
service density will be greater than to the east coast. Already there will be
four airlines, Delta, American Airlines, China Eastern and United Airlines
operating the Los Angeles-Shanghai route by mid-2015, where four years ago
there was only China Eastern. In the course of the next two decades, that
feature will mightily shift the economic centre of North America westwards.
This spells massive opportunities for western airports and other economic
interests, from Vancouver to Mexico City.
If equity investors are to return to the airline market, clearly there is a
need for profitability. Following consolidation among the larger US and Latin
American airlines, as well as a stabilisation in the Canadian competitive
equilibrium, fares have risen and profitability has soared. While much of the
talk around the industry is about the need to be customer-centric, there is a
new benchmark for profitability and lower performers are being punished by
the markets.
This raises the age-old conflict between short-term gains and long term
sustainability – with the potential both to commoditise the industry and to
reduce the willingness (or ability) of airline leaders to innovate outside a
narrow band of behaviour. This panel explores the risks and rewards of the
new environment.
How substantial is/should be the role of analysts in determining the shape of
the airline industry? The startling recovery of the North American airline
industry majors in financial terms is the big story of this decade; but is
the margin benchmark now set so high that airline products simply drift
towards the centre?
Moderator: L.E.K Consulting, Managing Director and
Partner, John Thomas
Frontier bills itself as the ‘Target’ of aviation and has identified Spirit
as the ‘Walmart’. Both are making headway in picking up routes which have
been “rationalised” as part of the consolidation process or which have been
identified as pockets of low price demand. Allegiant too, with its unique
model, is an expert at point-to-point route analysis. As they evolve, the
full service airlines cherry pick the revenue aspects of unbundling, like
baggage and seating charges.
But, aside from Southwest Airlines, which scarcely fills the bill as an ULCC
any more, the low fare market is arguably underserved.
Panellists:
In
the cradle of the free market, infrastructure privatisation is not even a
dirty word in the aviation sector; it is simply absent. Meanwhile an
over-zealous Congress throws layer on layer of often counter-productive
regulation designed to protect consumers. An airline’s life is not an easy
one.
It is hard to imagine a privately contracted NextGen provider being permitted
the latitude that a government authority has. For a function so fundamental
to efficiency and the national economy to be dependent on 1970s technology is
remarkable. Meanwhile inefficiency and delays cost billions.
Likewise many of the US airports are starved of funds to expand, trapped in a
complex web of Federal government subsidy, local government poverty and
vested interests in the status quo. For years “experiments” with
privatisation have faltered, with no other solution on the horizon.
In reality privatisation is no panacea, but clearly the US needs a new
direction, if its airline industry is to deliver the infrastructure it needs.
Panellists:
Canada,
like the US, has established high barriers against foreign ownership of
national airlines. Internationally, the guiding force behind Canada’s
international aviation policy is to protect its major flag carrier, no matter
whether the routes affected are operated by it. Protectionism – for example
against the Gulf airlines - often provides greater protection for Air Canada’s
Star Alliance partners’ hubs than for the airline itself; it also encourages
fifth freedom connections over the US on American carriers.
Canada’s two largest airlines Air Canada and WestJet have undergone
significant changes during the last couple of years – most notably through
the creation of new subsidiaries to broaden their passenger streams. But
upstarts hoping to capitalise on the ultra low-cost business model could add
a new competitive dimension to the duopoly Air Canada and WestJet have
enjoyed for nearly 20 years. Is the Canadian market ripe for the new breed of
ultra low-cost airlines, or will the higher costs of operating in Canada
ultimately dampen the ambitions of airlines hoping to change the country’s
competitive dynamics?
After an explosive period of growth, an uncertain economic environment has
settled over much of South America. With the combination of LAN and TAM, the
region now has an airline of global scale in LATAM. In Central America, there
is steep competition in the LCC markets, and relatively higher growth.
Meanwhile, airport infrastructure (often like other surface infrastructure)
does not lend itself to high growth rates.
Panellists:
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The Gulf airlines’ unique long haul-to long haul model and their global reach
have spelled major change for established airlines in Europe and Asia especially.
Some major European airline groups – most notably Lufthansa – have stridently
opposed expansion of the Gulf airlines. One, IAG has however grown close to
Qatar Airways, now a member of the oneworld alliance and owner of 10% of IAG.
Asian airlines, more accustomed to competition for sixth freedom traffic,
have fought back.
In the US, whatever the eventual regulatory outcome as the three major
airlines seek government protection, the Gulf airlines have already reset the
bar for international travel expectations. Turkish Airlines too, although
just off the ideal geographic axis, is almost a Gulf carrier – but only in
being a highly successful global hub carrier.
North American airlines are less threatened, because of its geography, but
even so strident industry voices are raised against allowing them greater
access, despite the consumer benefits.
These voices have remarkably included calls from the CEO of the world’s
largest airlines for the US to reverse the open skies policy that the US has
disseminated across the world over the past three decades.
Canada has meanwhile reverted to use of 70-year old bilateral trade
restrictions to limit the Gulf airlines’ access, while Latin America is
gradually welcoming more services.
The Americas airline business is notably short on women CEOs – and the US is
one of the standouts in its lack of female executives, outside traditional
roles in human resources and marketing. Since CAPA conducted extensive report
in its Airline Leader journal four
years ago, the tiny group of women airline CEOs worldwide has actually
reduced in number.
Perhaps it is simply that women are smarter than men in selecting the
industries that offer greater stability. But the lack of diversity in the top
executive ranks is a serious challenge if airlines aim to compare themselves
with top S&P industrials over the long term.
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